22 February 2016

The majority of real estate complaints lodged with the department involve residential tenancy or property management matters. Often these matters should not have occurred in the first instance or should have been addressed at an agency level rather than being escalated to the department.

The main concerns include:

• Inspections not being undertaken, property condition reports being inaccurate or not signed/dated by the agency.
• The Lessor is not notified of property or tenancy issues, despite being contracted to do so – eg breaches by tenant or damage to property.
• Termination notices are either not issued to tenants or they are issued and not followed through.
• The agency not being aware of the tenant’s conduct at the rental property – eg more occupants than permitted within tenancy agreement and pets at property when not permitted.
• Security bonds – eg late lodgement and return of bond to tenant against principal’s wishes.
• Rental payment discrepancies.

While the issues are fundamental to the role of a property manager in a residential tenancy arrangement, the department is often asked to intervene following a complaint by a lessor or tenant. Our enquiries indicate some agents and property managers did not have an adequate understanding of their obligations relating to a residential tenancy, thereby requiring the department to provide educational advice and in some cases, compliance action.

It is important to note that the Code of Conduct for Agents and Sales Representatives 2011 (Code) and the Real Estate and Business Agents Act 1978 require unlicensed employees to be constantly supervised and controlled by the appropriate licensee.
The licensee must personally manage the agency’s business on a full-time basis, taking reasonable steps to ensure employees comply with all the relevant legislation. The Code requires that an agent render contract services with due skill, care and diligence.

There appears to be room for improvement around the supervision and training of property managers and the department can assist with the legislative obligations.

It was recently noted in bulletin issue 102 that the department’s proactive compliance program is assisting agencies to better understand their legal obligations. Residential tenancy and property management has recently been added to the program and aims to identify and remedy areas of risk through guidance, best practice and education. Further information is availble from the proactive compliance program page.

Residential tenancy information section can assist property managers and agents to resolve tenancy based disputes before they escalate. Specific enquiries can be made to the department by email or by calling telephone number 1300 30 40 54.